Investment Prospectus www..vic.gov.au Mildura Motorsports & Community Precinct: a project of Mildura Rural City Council.

Authorised by: Mildura Rural City Council 79 Deakin Avenue MILDURA 3500

(03) 5018 8100 www.mildura.vic.gov.au

August 2018 Edition 3 Content

The Project ...... 05 Our Economy ...... 07 Our Region ...... 09 Motorsports History and Participation...... 11 Background ...... 12 Development Proposal ...... 15 Full Master Plan ...... 17 Stage One Development ...... 19 Stage One Proposed Funding Mix ...... 20 Investors ...... 22 Government ...... 25 Private and Community Investors ...... 27 Support and Advocacy ...... 28 Your Opportunity ...... 31

Mildura Motorsports & Community Precinct Investment Prospectus 03

The Project

Establishing an integrated, multi-purpose Motorsports and Community Precinct. Stage one is developing a bitumen raceway and skidpan with associated infrastructure.

The Mildura Region

Mildura is a leading, rapidly growing, diverse, vibrant and innovative regional municipality. Situated in north west on the iconic Murray River, the area is renowned for its agricultural, horticultural and tourism industries, its moderate-to-warm climate, relaxed lifestyle and high participation in motorsports nationally.

Located within the tri-state region of Victoria, New South and South , Mildura is the regional hub for hundreds of thousands of residents across three states.

Mildura Motorsports & Community Precinct Investment Prospectus 05

Our Economy

Mildura is the 30th largest City in Australia, which is made up of the below:

Gross Regional Product $3.16b (June 2017)

Building approvals: $158m (2017/18)

Home to Australia’s largest primary produce and wine processing businesses: The Mildura region boasts the nation’s largest citrus packer and exporter and four of Australia’s top 10 wineries (based on wine crush). It’s also home to the nation’s largest vegetable concentrate manufacturer, dried fruit packer, manufacturer of natural tartaric acid and the largest almond processing facility in the southern hemisphere.

Number of businesses: 5,271 (2017)

Food production: The Mildura region produces 20% of Australia’s wine grape crush, 24% of the nation’s citrus, 98% of Australia’s dried grapes, 75% of Australia’s table grapes and 68% of the country’s almonds.

Home to three of Australia’s national peak horticulture and agriculture bodies: Dried Fruits Australia, Citrus Australia and the Australian Table Grape Association are all based in Mildura.

Mildura Motorsports & Community Precinct Investment Prospectus 07

Our Region

Area: 22,330km²

Mildura boasts some of the largest developments nationally.

The last few years have seen a strong interest in developments in the region and the commitment of large scale funding towards major projects from the three tiers of Government and private investors. In the last five years there has been over $500 million worth of large scale developments and an additional $2.5 billion in large scale projects committed to the Mildura region which is being proposed to be established in the next 2-10 years.

Major Projects and Our Industries and Developments Infrastructure

• $2.5b Renewable Solar Facilities • La Trobe and Monash University campuses • $220m Murray Basin Rail Project to in Mildura standardise and upgrade rail infrastructure • Sunraysia Institute of TAFE provide courses • $120m Dockside Mildura Marina relevant to motorsport • $120m Sunraysia Modernisation Project to • Victoria’s largest regional airport is in upgrade irrigation infrastructure Mildura offering direct flights to Sydney, • $62.8m almond processing facility , and Broken Hill • $32m Hattah Lakes Environmental Works • Availability of natural gas Project • Two large hospitals – the Mildura Base • $30m Wine and distribution infrastructure Hospital and Mildura Private Hospital • $19.2m Stage 1 of the Mildura Riverfront • Modern water supply infrastructure Redevelopment • A major producer of horticultural and • $16m Stage 1 of Mildura South Regional agricultural goods Sporting Precinct • Vibrant and strong tourism industry that • $10.1m Mildura Natural Gas Capacity last year injected $313 million into the Expansion Project district and provided 1777 full-time jobs • $8.7m Mildura Arts Centre redevelopment • Social and health services • $10m Mildura Airport runway overlay and • Several large mining developments in the extension projects region • Multiple solar facilities committed and constructed

Mildura Motorsports & Community Precinct Investment Prospectus 09 Mildura Motor Sports & Community Precinct Investment Prospectus 08 Motorsports History and Participation

Motorsport involvement in Mildura has a rich and Motorsports Events diverse history with some clubs and events dating back The district’s enthusiastic and progressive motorsport to the 1930’s. Motorsport participation in Mildura is clubs regularly host state and national titles throughout four times the national average, while there are more the year, including karting, speedway bikes and cars, than 100 motorsport events held in the region each off-road (car) racing, drag racing, motocross, and year. enduro. Champions Mildura boasts some of the biggest and most Mildura could well be described as Australia’s home of successful motorsport events in the country, attracting motorsport. There are very few regions that can boast thousands of competitors and spectators each year. such an impressive list of champions across a wide range of motorsport disciplines. Mildura’s Olympic Park Speedway made history in October 2015 when it became the first venue outside Europe to host the World Team Speedway under 21 Road racing Championships. On bitumen they include Supercar drivers Todd Kelly, Rick Kelly and Cameron Waters, multiple Australian The Australian National Drag Racing Association held Superbike champion Josh Waters, and Australian Top the Summit Racing Equipment Sportsman’s Series in Fuel drag racing champions Phil Lamattina (retired) Mildura in December 2015 and October 2016 which and four-time champion Darren Morgan, both of was aired on SBS and Speedweek reaching just under whom call Australia’s premier one-eighth mile drag 400,000 people in Australia, US, New Zealand and racing facility – Mildura’s Sunset Strip - home. Indonesia. Off-Road Sunraysia also hosts two major ski racing events each year – the iconic Mildura 100 on the Murray River On dirt, the district has produced numerous champions at Easter, recognised as the fastest ski race in the including three-time World Solo Speedway champion world, and the Ted Hurley Ski Race Classic, attracting , 10-time Australian Solo Speedway hundreds of competitors and thousands of spectators. champion (retired) and five-time Hattah Desert Race winner Warren Smart. It’s also produced The Hattah Desert Race meanwhile is held on the first the only man to win Australia’s toughest off-road race, weekend in July each year and attracts more than 500 the Australasian Safari, on both a motorcycle and in a of the very best off-road riders in the country to the car, John Hederics. John has won the event 10 times - region. It also attracts massive spectator numbers and more victories than any other competitor. widespread national magazine coverage.

On the Water The majority of these events take place within 10 Mildura’s reputation is equally impressive on the kilometres of Mildura’s major accommodation houses, water with numerous national and world title winners. which is a major convenience factor for both spectators Sunraysia-based observer Damien Matthews is a and competitors. multiple and consecutive winner of the Mildura 100 Ski Race, the fastest ski race in the world. He’s also won multiple Southern 80 ski races.

Mildura Motorsports & Community Precinct Investment Prospectus 11 Background

For many years there have been discussions in the In association with the feasibility study the Victorian community and among motorsports enthusiasts about Government committed $2m towards constructing the development of a premier regional motorsports a drag race facility at Swan Hill. It was also listed as precinct in Mildura. In 2011 Mildura Rural City Council a Tier 1 investment and development project in the (Council), in conjunction with Swan Hill Rural City Murray Regional Product Gap Analysis and Tourism Council, engaged in a North-West Victorian Motor Development Plan of July 2012. Sports Feasibility Study (feasibility study) to facilitate the development of all motorsports across the region. For Mildura, the feasibility study forecast an annual $61.7 million economic benefit if its recommendations The Feasibility study recommended the: were followed. Forty-four percent, or $27.3 million of this economic benefit was based on the establishment • Co-location of nine of Mildura’s current motorsport of a new motorsports facility in the form of a bitumen clubs and facilities, which are located at six raceway, skidpan and associated infrastructure. To different sites, into one to three sites in the coming understand the true benefits of this proposal and years. The feasibility study identified Block H, ensure it did not become a burden to ratepayers, which is a 547 hectare site at Koorlong owned by Council embarked on an additional piece of work Council, as the most viable location for a future in 2013 called the Australian Motorsports Raceways multi-user motorsports facility in the region Benchmarking Review (benchmarking review).

The results of this benchmarking review further • Development of a bitumen raceway, skidpan supported the findings of the feasibility study - that and associated infrastructure at the Mildura the staged development of a motorsports precinct motorsports precinct. This new piece of in Mildura would provide extensive economic and infrastructure was estimated to generate an social benefits for the region. Feedback was also additional $27.1 million per annum in direct obtained from 13 of the 19 existing bitumen raceway economic benefits for the region owners and operators throughout Australia, as well as economic development units in their respective cities The Feasibility Study estimated that: and towns. This benchmarking review is the first to comprehensively study bitumen raceways and their • Motorsports deliver $21.4 million per annum associated motorsports precincts on a national scale. of economic benefits to Mildura. Greater economic benefits of $61.7 million per annum were projected if the recommended facilities are developed and if effective management, marketing and scheduling are applied

• Participation in motorsports by residents in north west Victoria is three times the Victorian average and four times the national average

Mildura Motorsports & Community Precinct Investment Prospectus 12 Importantly, the benchmarking review highlighted the The following items were completed as part of financial viability of a bitumen raceway in Mildura, and the study: that Mildura has a large enough catchment within a three to four-hour drive to support such a development. • Geotechnical survey of the site However it also found that the catchment was far • Features and levels survey of the site enough away from other major centres to avoid drive- in/drive-out competitors and spectators, resulting in • Cultural Heritage Management Plan and/or greater economic and tourism benefits for the region. assessment of the site The benchmarking review also highlighted the most • Vegetation assessment of the site efficient owner and operator models for a raceway, • 30% engineering drawings of the bitumen raceway and suggested both opportunities and possible pitfalls associated with building a bitumen race circuit and skidpan based on the experiences of other operators around • Detailed financial and performance information the country. It also found that once established and needed for potential funding of the project infrastructure developed, raceways required only • Identified the scale of the return on investment for limited government funding to remain sustainable long-term. the project • Confirmed the scale of the economic viability and The full Business Case for the Mildura Motorsports benefits of the project and Community Precinct was completed in 2016 and follows the Department of Treasury and Finance Guidelines, allowing the document to be used to These documents will be provided to shortlisted development advocate for three tiers of government funding. It proponents on a commercial in confidence basis for their use and evaluation. includes a detailed and staged development plan for a motorsports precinct in Sunraysia at a Council- managed site at Koorlong, 15 kilometres from Mildura’s CBD. The staged development plan includes the design, cost and placement of a car/motorcycle bitumen raceway and skidpan, with required utilities and infrastructure. It also includes the relocation of existing Mildura motorsports facilities to this site over the short to long term.

Mildura Motorsports & Community Precinct Investment Prospectus 13

Development Proposal

Research conducted into the Mildura Motorsports and Community Precinct has led to the preparation of both a master plan for the entire project and a Stage 1 development plan. The precinct will be completed through a staged development with Stage 1 being the basis for this investment prospectus.

Five project options were identified in the business case with Option 5 being the staged development of options 1 - 4:

Project Option 1 Project Option 2 Project Option 3 Project Option 4 Project Option 5

Bitumen race track Bitumen race track Bitumen race track Bitumen race track Includes all Skid pan Skid pan Skid pan Skid pan components found Pits and control tower Pits and control tower Pits and control tower Pits and control tower in option four to be Office facilities Office facilities Office facilities Office facilities delivered through Maintenance shed Maintenance shed Maintenance shed Maintenance shed staged development Camping facilities Camping facilities Camping facilities Camping facilities Food & beverage Food & beverage Food & beverage Food & beverage Fuel facility Fuel facility Fuel facility Lighting Lighting Lighting Vehicle handling Vehicle handling area Vehicle handling area area Permanent and Permanent and temporary seating temporary seating Garages & work- Garages & workshops shops Jet boat course Function space Additional circuits (go-karting, speed- ways, dirt kart and other dirt-based motorsport) Additional Commercial Areas Capital cost: $21.7m Capital cost: $31.1m Capital cost: $38.7m Capital cost: $72.1m Capital cost: $80.1m

Job Creation: Job Creation: Job Creation: Job Creation: Job Creation: Year 1: 324 Year 1: 440 Year 1: 527 Year 1: 1350 Year 1: 324 Year 30: 83 Year 30: 102 Year 30: 102 Year 30: 885 Year 30: 766

Economic Impact 30 Economic Impact 30 Economic Impact 30 Economic Impact 30 Economic Impact 30 Years Mildura: Years Mildura: Years Mildura: Years Mildura: Years Mildura: $162.25m $195.65m $201.81m $1.29b $714.50m

Economic Impact 30 Economic Impact 30 Economic Impact 30 Economic Impact 30 Economic Impact 30 Years Victoria: Years Victoria: Years Victoria: Years Victoria: Years Victoria: $173.38m $209.52m $216.76m $1.37b $761.90m Benefit Cost Ratio Benefit Cost Ratio Benefit Cost Ratio Benefit Cost Ratio Benefit Cost Ratio (BCR): 7.96 (BCR): 6.74 (BCR): 5.58 (BCR): 18.97 (BCR): 15.43

30 year operating 30 year operating 30 year operating 30 year operating 30 year operating surplus or net present surplus or net present surplus or net present surplus or net present surplus or net present value (NPV): value (NPV): value (NPV): value (NPV): value (NPV): $7.85m $5.31m $1.64m $19.54m $7.89m Risk Rating: Low Risk Rating: Low Risk Rating: Low Risk Rating: Medium Risk Rating: Low

Job Creation The Benefit Cost Ratio (BCR) Net present value (NPV) The vast majority of employment will be Attempts to summarise the overall value A popular measure of profitability used to created away from the actual precinct in for money of a project and therefore the assess a given project’s potential return Mildura through related industries such as economic benefit of operating the facility on investment or rate of return in the accommodation, retail, food and beverages. versus the cost of building it. future, taking the time value of money into Year 1 includes direct and indirect jobs account. created as a result of construction activities.

Mildura Motorsports & Community Precinct Investment Prospectus 15

Eventually, the Mildura Motorsports and • Mildura Kart Club has committed to move to Community Precinct will be able to host a unique the precinct when their current lease expires in and diverse range of motorsport events, as well 2037 as becoming an important multi-use facility for • Mildura Speedway Drivers Club has committed tourist and community events. to move to the precinct when their current The staged development plan includes lease expires in 2026 agreement by existing motorsports clubs and • Mildura Motorcycle Club (speedway) has facility operators to relocate to the precinct in committed to move to the precinct in 35 years the short to long term, including: • Other dirt-based motorsports will look to move to the precinct in the next five to • Interest in developing a jet boat course in 30 years the next two to five years • Commitment from a driver training facility to move to the precinct in the next two to 22 years (dependent on government funding and the ability to leverage current opportunities)

The venue, accessed by a sealed bitumen road, is already home to the Sunraysia Drag Racing Association, which operates a one eighth mile sealed drag strip that has supported many regional and state events in recent years. The site is also home to Dirtworx - a commercial business operating off-road junior and senior motorcycle circuit and motocross tracks, as well as an enduro loop.

Stage 1 of the Mildura Motorsports and Community Precinct, for which Mildura Rural City Council is seeking investors, consists of:

• Sealed three-kilometre road circuit (with potential for length extension) • Multi-use skid pan measuring 100m X 45m • Pit area and hard stand areas • Control tower • Offices and associated facilities • Maintenance/wash down shed • Camping facilities • Food and beverage services Stage 1 - $21.8m Proposed Funding Mix

The Mildura Motorsports and Community Precinct Stage 1 of the project is an attractive investment is a unique project due to its ability to provide a for government as it has a benefit/cost ratio of desirable value proposition for both government 7.96 and is considered low risk. It is also forecast and private investors. to conservatively create 83 new jobs within the Mildura region and a net economic impact of To ensure this project is a viable investment $162.3m for Mildura and $173.4m for Victoria over proposition for the private sector, three tiers of 30 years. government funding would be required. A public private partnership is the most viable model for this project to be realised in the short to long term.

Funding Model

$25,000,000 600% $9.8M $8.7M $7.6M $6.5M $5.5M $4.4M $3.3M $2.2M 527% 500% $20,000,000 318% 400%

$15,000,000 300% 303% 151% 214% $10,000,000 79% 109% 200% -25% -39% 57% 169% -37% -16% 101% 100% 61% $5,000,000 15% 34% -19% -10% 1% -46% 0% -60% $13.1M $14.2M $15.2M $16.3M $17.4M $18.5M $19.6M $21.8M $0 -100% 123456789101112 OPTIONS Government funding ($’s) Private Investor Investment ($’s) Average Annual Return on Investment over 30 years Average Annual Return on Investment over 5 years Average Annual Return on Investment over 10 years

The proposed funding mix is determined from a cost of capital o Event days of 8 regional and 1 major event p.a modelling in the above graph that incorporates the following o Attendance at events based on existing events in Mildura assumptions: o Food & beverage sales o Facilities such as the workshops, garages, storage • 5% annual interest rate These have been largely benchmarked from other facilities • 12 payments per year • 30 years finance (terms) • The Expenses from operating the facility incorporates conservative • Differing percentages of capital borrowed and benchmarked figures which includes: • 55% utilisation of the facility in year 1 and 2% increase in every o Staff costs for three full time employed employees in year 1 subsequent year o Facility running costs of - Maintenance calculated at 1.5% of capital cost The costing model includes: - Running costs calculated at 2% of capital cost • The Principal plus interest o Asset replacements and upgrade calculated at a rate of 40% of • The Revenue from operating the facility incorporates conservative and capital cost benchmarked figures which includes: - Track replacement calculated every 15 years o Driver training - Other assets (buildings) calculated as being replaced every o Driver experience days 30 years o Corporate functions o Other costs like admin, marketing and other minor expenditure

Mildura Motorsports & Community Precinct Investment Prospectus 20 The graph for Options 1-4 illustrates that private In options 5-8 the Mildura Motorsports and investment would be unviable for the first five years Community Precinct will compare favourably because of the negative return on investment. against these competing investments, if the appropriate public/private funding mix is marketed Private investment only becomes viable from and communicated. The funding mix will not only Option 5 onwards, where return on investment for encourage private investment but the make-up the first five years is positive. Due to the uniqueness of the total government contribution will have an of this project and the sport, a higher rate of return impact on how quickly this project can be realised will be beneficial in attracting a potential investor or for the Mildura region. developer.

As a low risk investment, the Mildura Motorsports and Community Precinct development compares favorably to other low to medium risk investments such as:

• Property - 8% return and low risk¹ • Fixed income assets such as government and corporate bonds offer a 6.2% return and low risk² • Equities such as shares with a 5.5% return and high risk³ • Compared managed funds offered a 7.2% return4 • Cash such as savings and term deposits at 3.1% and low risk 5

1. Reported in the ASX’s 2016 Long-term Investing Report, Australian residential investment property averaged an 8% return per annum over 10 years to December 2015.) 2. According to the aforementioned ASX report, Australian fixed income assets averaged a 6.2% return per annum over 10 years. 3. According to the ASX report, Australian shares averaged a 5.5% return per annum over 10 years to December 2015 which encompassed the GFC 4. CommSec, in the last financial year (June 30 2015 to June 30 2016) 5. In Australia, cash averaged a 3.1% return per annum over 10 years, according to the ASX report.

Mildura Motorsports & Community Precinct Investment Prospectus 21 Why Invest in Stage One?

It is envisaged for this project to be realised it will is a proposed funding mix between government require investment from government and private (local, state and federal) and private investment with investment. Stage 1 involves the development of a Council providing additional support to enable this bitumen race track, skid pan and associated facilities. to occur.

This is a new motorsport offering for the Mildura Detailed on coming pages is information to support area and will move towards development of a why government and private investors may want to full motorsport precinct planned for Block H, invest in this valuable project. Koorlong. Development of Stage 1 of the precinct

All Investors

• Landmark development • Significant economic and social benefits to the Mildura region • The Mildura region is well positioned to develop such a facility, hosting more than a 100 motorsports events every year which range from • Mildura is a major tourism destination which club events to national and international events. continues to grow The FIM Speedway U21 World Championships 2015 were hosted in Mildura. The first time this • Mildura has Victoria’s largest regional airport. 7 event has been held outside of Europe flights a day between Melbourne and Mildura on three airlines and direct flights to Sydney, • High participation rates in motorsports in Mildura Adelaide and Broken Hill. The airport can that are 4 times the national average accommodate domestic and commercial flights for the transport of large scale tourists, agricultural • Large catchment > 2 million within a 3-4 hour goods and if desired, motor vehicles drive of Mildura • The motorsports industry currently employs • High concentration of State, national and approximately 347 people locally and contributes international motorsports champions indicating approximately: advocacy, profile and ability to leverage opportunities o $100m to total output o $32m to total local sales o $26m to total local expenditure • High level of commitment from the local o $16m to total wages and salaries motorsports industry and community o $31m to regional exports o $45m to regional imports • Strong support from peak national and state motorsports bodies , the tourism industry, • More than $300,000 in cash and in kind support education providers and business and community has been contributed to research and validation advocates of this opportunity by State Government, Local Government, The Confederation of Australian Motorsports, Motorcycling Australia, Visit • Complements recent large scale projects and Victoria, Murray Regional Tourism Board, private developments and creates opportunities to enterprise, the motorsports clubs and facilities leverage opportunities for stage 1 of this project in Mildura, the Mildura Motorsports Industry Reference Group and the Mildura Motorsports Advocacy Group

Mildura Motorsports & Community Precinct Investment Prospectus 22 • Will create education and training opportunities • Climate - moderate to warm permitting all year in fields such as driver education for secondary motor sports activities including ideal conditions school students and adults, as well as potential for car and motorbike testing which has created for truck licencing. Local training providers have some interest and demand in recent years indicated that they see substantial opportunities for training and education at the site. Mildura’s SuniTafe have indicated that if the development • Accommodation supply of more than 6,000 can occur, this will open up more opportunities for available beds makes Mildura an ideal location to vocational training in the motorsports industry at host small to large scale motorsports events their facility in Mildura • Experience in hosting major events. • Will create many social benefits. Development of Mildura has enjoyed a reputation for its diverse the precinct can provide social benefits including, calendar of events for decades. Council provides participation, volunteering, capacity building, a strong role in capacity building and working with social cohesiveness and social engagement event organisers to enhance and grow their event. opportunities for the local community. Social With the majority of our annual events lead benefits would include opportunities for by community organisations and partnered by disadvantaged youth groups (e.g. indigenous, Council, some of our recent major events include: migrant youth) to engage in social interaction, volunteering, training and participation at the site Attendance Year Event (approximate)

• Financially viable investment with an attractive 2017 Annual New Year’s 6,000 return on investment from year 1 Eve Community Celebrations

• Utilities are available with some cost effective 2016 Annual Easter Power 20,000 opportunities for large scale developments and sports Easter major projects such as motorsports. Opportunities Weekend includes existing gas connections close to the proposed site, options to source water that 2016 Annual Mildura 12,000 Country Music range from the more expensive town water to Festival the cheaper recycled or potable reuse water and power options that range from minimal cost 2016 Annual Merbein 10,000 upgrades to existing power infrastructure or the Vanilla Slice Triumph more clean and green solar power opportunities 2015 FIM Speedway 6,000 Under 21 World • This project is shovel ready for an investor or Championships developer. The business case Includes extensive 2014 triple j One Night 18,000 research on the proposed site including cultural Stand heritage assessments, features and levels surveys, geotechnical design surveys and vegetation 2012 Ulysses 4,500 assessments. Stage 1 includes 30% engineering National for the bitumen raceway and skidpan Conference

Mildura Motorsports & Community Precinct Investment Prospectus 23

Government Why invest in Stage one of the Mildura Motorsports and Community Precinct?

This development: industries such as accommodation, retail, food and beverage. Year 1 is high because of the • Leverages off the existing importance of employment created due to construction.* motorsports to the region: o motorsports currently contributes $21.4m in direct economic benefits to the region per • Has a benefit cost ratio of 7:96 annum o the development of stage 1 will add an • Aligns with National, State, Regional and Local additional $27m in direct economic benefits to Strategies and Plans the region per annum o participation in motorsports in the region is • Is an opportunity for an investor or developer to three times the State average and four times partner with other funding partners to realise an the national average opportunity that will diversify the current tourism offering. It will also provide a unique and iconic • Projected to add a net economic benefit of tourism attraction that can attract significant $173.4m to Victoria and $162.3m to Mildura visitors through major and minor events, as well over 30 years. This includes additional or new as leverage future motor sports industry business spend as a direct result of the new motor sport developments precinct.* • Highlights the need for some Government • Will create 324 new jobs in year 1, 86 jobs in funding and that a part funding model between year 10, 100 jobs in year 20 and 83 jobs in year Government and private enterprise would be the 30. The vast majority of employment will be way to see the project realised created away from the precinct through related

*ref Full Business Case for the Mildura Motorsport & Community Precinct 2017

Mildura Motorsports & Community Precinct Investment Prospectus 25 Mildura Motorsports & Community Precinct Investment Prospectus 20 Private and Community Investors

Why invest in Stage One of the Mildura Motorsports and Community Precinct?

• Financial analysis shows a projected return on investment from the first year*

• Revenue projected for the raceway are very conservative. For example only 1 major event and 8 regional events are estimated per annum for the bitumen raceway. Utilisation of the facility is assumed to be 55% in year one and will increase by 2% per annum until year 24

• Council manage the leasing of the site through various leasing options

• There are detailed cost estimates, financial modelling assumptions and an engineering report for the bitumen raceway and skidpan for investors willing to sign a confidentiality agreement

• In the last 5 years there has been a strong demand and growth in major developments and projects in Mildura by the three tiers of Government and private investors. Since 2011, there has been over $500m worth of large scale developments and an additional $2.5b in large scale projects committed to the Mildura region

• The land at the proposed site is owned by Mildura Rural City Council, apart from a grid of unmade road reserves that are Crown land. Council has worked with State Government to close the road reserves and have taken on the role of Committee of Management with a view to purchasing the land in the near future. In the future Council will look to change planning of this land to a zoning for motor sports

*ref Full Business Case for the Mildura Motorsport & Community Precinct 2017

Mildura Motorsports & Community Precinct Investment Prospectus 27 Support and Advocacy

During development of the business case for this members have been engaged through two rounds project, Council received strong support from of engagement for this project and there has been government (including $103,000 from the Victorian strong overall support to see Stage 1 of the project Government to develop the business case), peak realised. motorsport bodies including CAMS (Confederation of Australian Motorsports) and Motorcycling Australia. National and local motorsport clubs, Tourism Industry community organisations, businesses and the local There are letters of support and contributions to the community also supported the initiative. research findings for this project from state, regional and local tourism bodies which include Visit Victoria, There are 34 letters of support within the business Murray Regional Tourism Board and Mildura Regional case from local motorsport clubs, businesses Development (formerly Mildura Tourism). interested in basing themselves at the site or wishing to utilise the track facilities, as well as many car clubs Mildura Rural City Council from Victoria and interstate. Interested businesses Council has made a major commitment towards include race day operators, driver/rider experience realising the Motorsports and Community Precinct. organisations and driver education bodies. CAMS It will play a major role as sponsor of the project and Motorcycling Australia have provided extensive and will assist in facilitating planning, club and in-kind support towards this project and continue to community consultations, development approvals advocate for it at a national level. and development programs throughout the life of the project. It will also facilitate the formation of management, programming and user liaison bodies Motorsports industry in Mildura and processes. Council will continue to support There are eight motorsports clubs and one driver the development of the project and will look to training facility in Mildura. Each motorsport club/ determine further support it can provide to enable facility has had one volunteer represented on the the project to progress. In a major effort to realising Mildura Motorsports Industry Reference Group the project, Council has: since 2013. This group has driven development of the Mildura Motorsports and Community Precinct • Conducted the comprehensive planning and staged development plan. Three are located at the research into geotechnical, cultural heritage, proposed site, while the remaining clubs/facilities features and levels, vegetation, zoning, leasing, have committed to moving to this precinct in the infrastructure considerations and completed short to medium term. There are also letters of 30% engineering drawings for stage 1 of the support and active advocacy for this project from development the peak motorsports bodies on a national, state and regional level which includes Confederation • Defined its position regarding the retention of site of Australian Motor Sports (CAMS), Motorcycling ownership and the creation of long term leases for Australia, Australian Formula Jet Sprint Association, investors Speedway Australia, and Australian National Drag Racing Association. • Consulted extensively with motorsport clubs considering relocating to the motorsport precinct Mildura community over the coming years There is a strong level of support in the Mildura community, as evidenced by the popularity of social media including a local Facebook page which has • Initiated investigations into an array of additional 2078 ‘likes’ as of December 2016 supporting the funding sources for other elements of the project development of Stage 1 of the project. There is an with these including the use of Council resources advocacy group comprising up to 50 members from for some infrastructure elements, State and business, motorsports and the general community Federal government funding, club and community who are willing to advocate for this project and assist financial and in-kind contributions and crowd in securing funding. Just under 1000 community funding options

Mildura Motorsports & Community Precinct Investment Prospectus 28 “The development of a regional bitumen circuit in Mildura is a project CAMS has not only watched with keen interest, but been consulted on several times since its inception. We are major supporters of this project and the raft of opportunities it would deliver for Mildura, its residents and motorsport generally. Whether it’s driver/ rider training, car club days or race events, this project offers so many benefits to the region. CAMS will continue to be a major supporter.” – Eugene Arocca. CEO Confederation of Australian Motor Sport.

“Motorcycling Australia is fully supportive of this proposed facility. If a race circuit can be developed it will offer a great opportunity for many motorcycle events to be held at the circuit. The development of a new race circuit and skid pan provides more opportunities for our competitors to compete, and the location of the track in regional north west Victoria would be an ideal location. There are already great events in Mildura for other motorcycle disciplines and I am sure this would allow even more.” – Peter Doyle. CEO Motorcycling Australia

“Mildura is ideally positioned for a motorsport precinct. It is centrally located between Melbourne, Adelaide and Sydney with a population base of over two million people within four hours. Competitors and spectators from these areas already travel to the many motorsport events in our area, and I know many of my competitors and spectators often stay for a holiday to enjoy the river and our great lifestyle.” – Leigh Adams. National and international champion.

“Mildura has an ideal climate to run motorsport events every day of the year. A motorsport facility like this would be well received by competitors and spectators alike, who can travel here knowing they’ll have good weather conditions as well as being able to enjoy a host of other activities in town following the event.” – Darren Morgan. Multiple Australian Top Fuel drag racing champion.

“Motorsport is huge in Mildura, with a strong following for all motorsports. I received great support from the community during my development and a facility like this would be well supported by the community I’m sure.” – Cameron Waters. Supercars driver.

“After decades racing at circuits across Australia and internationally, the opportunity to race in my home town of Mildura would be an amazing experience in front of my family and friends, I look forward to this facility being developed.” - Josh Waters. Multiple Australian Superbike Champion

Mildura Motorsports & Community Precinct Investment Prospectus 29

Your Opportunity

The Mildura Motorsports and Community Precinct is an exciting prospect for investors and for Mildura. Council What to do next… is seeking approaches from potential investors, clubs, individuals, private businesses and companies who might Interested parties should contact Mildura Rural City be interested in working in partnership with Council to Council’s Events and Projects team to discuss a range of help realise the motorsports precinct in coming years. funding and investment opportunities. In particular, Council is seeking one or more partners to realise the first stage of the development at a cost of MRCC Events and Projects Unit $21.8m and includes: (03) 5018 8100 [email protected] • A sealed road circuit PO Box 105, Mildura VIC 3500 • A multi-use skid pan www.mildura.vic.gov.au • Pit area • Control tower • Offices and associated facilities Site visits can be arranged for interested parties, further • Maintenance/wash down shed detailed financials on the precinct are available on • Camping facilities, and request. • Food and beverage facilities. All inquiries will be treated confidentially. For more information on the proposed motorsport precinct please watch our 3D animation video www.mildura.vic.gov.au/Motorsports

Important Information

This document is not a prospectus or offering document under Australian law or under any other law. It is for information purposes only and does not constitute an offer, invitation or recommendation to invest. No does it constitute financial product advice.

Certain statements made in this document are forward-looking statements. These forward-looking statements are not historical facts but rather are based on Council’s current expectations, estimates and projections about the municipal district and motorsports generally. Words such as “anticipates”, “expects”, “intends”, “plans”, “believes”, “seeks”, “estimates” and similar expressions are intended to identify forward-looking statements. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors, some of which are beyond the control of Council, are difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. Council cautions readers not to place undue reliance on these forward-looking statements, which reflect the view of Council only as of the date of this document. The forward-looking statements made in this document relate only to events as of the date on which the statements are made.

Neither Council nor any Councillor or member of Council staff gives any representation, warranty, assurance, nor will guarantee that the occurrence of the events expressed or implied in any forward-looking statement will actually occur.

To the maximum extent permitted by law, Council and its Councillors and members of staff disclaim any responsibility for the accuracy of completeness of any forward-looking statements whether as a result of new information, future events or results or otherwise. Council disclaims any responsibility to update or revise any forward-looking statement to reflect any change in Council’s affairs or any change in the events, conditions or circumstances on which a statement is based, except as required by law.

Mildura Motorsports & Community Precinct Investment Prospectus 31 www.mildura.vic.gov.au